Administrative Costs Claimed by the Utah Disability Determination Service

(A-07-09-19005)

Objective

To evaluate the Utah Disability Determination Services’ (UT-DDS) internal controls over the accounting and reporting of administrative costs, determine whether costs claimed by the UT-DDS were allowable and properly allocated and funds were properly drawn, and assess limited areas of the general security controls environment. Our audit included the administrative costs claimed by the UT-DDS during Federal Fiscal Years 2006 and 2007.

Background

The Disability Insurance (DI) program provides benefits to wage earners and their families in the event the wage earner becomes disabled. The Supplemental Security Income (SSI) program provides benefits to financially needy individuals who are aged, blind, and/or disabled. Disability determinations under both DI and SSI are performed by DDSs in each State and other responsible jurisdiction.

The UT-DDS made duplicate payments for consultative examinations (CE) and medical evidence of record, reimbursed CE providers at a rate that exceeded the maximum rate allowed under Federal regulations, did not follow its established criteria for incentive payments to CE providers, and needed to improve its controls over the CE provider sanction process. Regarding general security controls, we found the UT-DDS needed to improve its computer inventory controls. In addition, the UT-DDS’ security plan was incomplete, disaster recovery plan (DRP) had not been tested, office key management lacked controls, and computer system backup data were not stored off-site.